The Dollar index cannot make a new higher high and is pulling back lower as expected below 80 and towards 79.85-.70. The Dollar index is moving lower towards the Ichimoku cloud support as we expected in our last analysis.
The Dollar index is heading towards the 38% retracement which is our target and now this target is inside the Ichimoku cloud support. Next important support for the Dollar index is the 79.60 level. Below that we find the 61.8% retracement at the 79.45 level. I prefer to wait to see where this downward move stops before trying to pick a bottom. Important short-term resistance is found at 80.15. A break above that level will signal that the decline is most probably over.
The daily chart continues to show the Dollar index is trying to break above the Ichimoku cloud resistance. A break above 80.40 will be a good bullish sign for the index that could push it towards 80.70. Currently the Dollar index is pulling back and stays inside the Ichimoku cloud, something that tells us that the pull back might be shallow and only reach our 38% fibonacci target.
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